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DeepSeek’s Rise Causes Historic $589Bn Loss for Nvidia

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US tech giant Nvidia saw its stock plummet nearly 17% on Monday, leading a sell-off across AI-related stocks after the Chinese AI chatbot DeepSeek gained sudden prominence. Nvidia’s market value dropped by $589 billion in a single day, marking the largest one-day loss in stock market history.

DeepSeek, a Chinese-developed AI model, launched its latest version, DeepSeek-R1, on January 20. The app has since become the most downloaded free app in the US. Developed at a fraction of the cost of its American counterparts, the emergence of DeepSeek has raised concerns about the future of AI investments and the dominance of US firms.

DeepSeek’s researchers claim the model was trained at a cost of just $6 million—significantly less than the estimated $100 million required to train OpenAI’s GPT-4. “If DeepSeek’s innovations are adopted broadly, training costs could come down significantly,” said Raymond James analyst Srini Pajjuri, though he cautioned that this may accelerate efforts by US firms to leverage their access to advanced chips to maintain a competitive edge.

Marc Andreessen, a Silicon Valley venture capitalist and adviser to President Donald Trump, called DeepSeek-R1 “AI’s Sputnik moment,” referencing the shock caused by the Soviet Union’s 1957 satellite launch.

The ripple effects of DeepSeek’s rise were evident across the tech sector. Nvidia’s rival Broadcom saw its stock tumble 17.4%, while Micron fell 12% and Advanced Micro Devices dropped more than 6%. Major tech players like Microsoft and Alphabet, Google’s parent company, also experienced declines of 2.14% and over 4%, respectively.

In Europe, Dutch chip equipment maker ASML ended Monday with a 7% drop in share price, while Siemens Energy, which produces AI-related hardware, saw a staggering 20% decline.

DeepSeek’s sudden popularity has sparked debates about the efficiency of AI models and their implications for the industry. Singapore-based tech equity adviser Vey-Sern Ling suggested that the app’s emergence “could potentially derail the investment case for the entire AI supply chain.”

However, some analysts remain skeptical of DeepSeek’s cost claims. Stacy Rasgon, an analyst at Bernstein, pointed out that the reported $6 million training cost likely does not account for associated expenses like prior research and algorithm development. “This announcement is not really worthy of the hysteria that has taken over the Twitterverse,” Rasgon added.

Meanwhile, Nvidia issued a statement describing DeepSeek-R1 as “an excellent AI advancement” but appeared unfazed by the competition.

DeepSeek’s launch comes at a time of heightened restrictions on the export of advanced US chip technology to China, further complicating the AI landscape. Former President Joe Biden’s administration had tightened these rules, limiting China’s access to Nvidia chips and advanced chipmaking technology.

Despite these challenges, Chinese developers like DeepSeek have found ways to innovate, using open-source software and exploring lower-cost approaches to AI. Liang Wenfeng, DeepSeek’s founder, reportedly built up a stockpile of Nvidia A100 chips before the US imposed export restrictions. Liang combined these chips with less advanced ones to train his model cost-effectively.

The timing of DeepSeek’s rise coincides with a major US push to bolster its own AI infrastructure. Last week, President Trump announced the Stargate AI project, which involves an immediate $100 billion investment in data centers and infrastructure, with plans to allocate an additional $400 billion over the next four years.

The initiative aims to secure America’s dominance in the AI space, with backing from SoftBank, Oracle, OpenAI, and UAE-based MGX.

As the AI sector grapples with DeepSeek’s disruptive potential, the company revealed on Monday that it had been targeted by cyberattacks.

“Due to large-scale malicious attacks on DeepSeek’s services, we are temporarily limiting registrations to ensure continued service,” the company said in a statement.

DeepSeek, founded in 2023 by Liang Wenfeng in Hangzhou, China, continues to challenge the industry with its low-cost AI model.

However, questions remain about the long-term implications of its innovations and whether Chinese AI firms can sustain their progress amidst US export restrictions.


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Ugo Onwuaso is an ICT enthusiast. He believes technology should be used for general good. He holds a Master of Public Administration (MPA) degree from the Lagos state University. Dear Reader, Your support matters. But we believe that technology makes life more exciting and helps improve the lives of people around Nigeria and indeed the world. That is why, we have devoted our energy to independent reportage of technology and finance and how they affect lives. Our incisive and analytical view of how technology news affects the daily life help individuals and organizations make up their minds. Quality journalism costs money. Today, we're asking that you support us to do more. Kindly support our effort to deliver technology and finance journalism to everyone in the world. Donate as little as N1,000. Bank transfers can be made to: UBA Plc 1017156876 Communication Week Media Ltd

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Identy.io Targets Nigeria, Kenya in Its Africa Expansion Strategy

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Nigeria and Kenya are the next target markets for Identy.io, a global provider of digital identities, as it expands into Africa. Facial, fingerprint, and palm identification are among the safe, mobile biometrics that the company specialises in.

According to Indenty.io, its platform runs locally on smartphones, eliminating cloud storage while maintaining security and privacy.

It goes to say this is achieved by leveraging standard smartphones for fingerprint and face scans, the company aims to bridge the continent’s digital divide, where a significant number of adults still lack basic identification.

To spearhead this rollout, the firm has appointed a specialised regional leadership team, including industry veterans from Nigeria’s Bank Verification Number programme, to integrate their automated Biometric Identification System into national digital public infrastructure.

The company says the significance of this move lies in the departure from traditional, “clunky” biometric models.

Historically, digital ID enrollment in Sub-Saharan Africa has been throttled by the high cost of specialised scanners and the logistical nightmare of deploying them to rural areas.

Identy.io notes that its approach shifts the heavy lifting to mobile software.

Identy.io is positioning itself to capture a market the World Bank’s Identification for Development initiative identifies as critical for financial inclusion.

If successful, this could accelerate government-to-person payments and healthcare access in regions where coverage currently sits below 70%.

“We are transforming the traditional industry model, which often relies on expensive and inflexible digital infrastructure,” says Antony Vendhan, Co-founder of Identy.io. “This allows our clients to reach underserved communities by providing individuals with multimodal access to secure their digital identities.”

The company will face established players like IDEMIA and Thales, who have long dominated government contracts.

Furthermore, Identy.io will face competition from up-and-coming regional fintech identity firms such as Smile ID, which already has a significant presence in Know Your Customer services throughout Africa.

To gain an edge, Identy.io has aligned itself with Modular Open Source Identity Platform (MOSIP).

By being listed on the MOSIP marketplace, the company says its tech becomes “plug-and-play” for governments building open-source national ID systems, a growing trend among nations wary of “vendor lock-in.”

While the primary focus remains on Nigeria and Kenya, Identy.io’s long-term roadmap includes a phased rollout to other emerging markets.

 


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Russia Blocks WhatsApp, Pushes State App Max as Alternative Amid Telegram Clampdown

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Russia has confirmed the blocking of popular messaging platform WhatsApp, directing its citizens to switch to the state-backed Max messenger, in a move escalating restrictions on foreign digital services.

Russia Blocks WhatsApp, Pushes State App Max as Alternative Amid Telegram Clampdown

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The decision, announced by Kremlin spokesperson Dmitry Peskov on Thursday, stems from WhatsApp’s parent company Meta’s alleged failure to comply with Russian laws, though specifics were not disclosed. This action follows days after authorities intensified curbs on Telegram, another widely used app among millions, including military personnel, officials and state media.

Peskov described Max as “an affordable alternative on the market for citizens, a developing national messenger,” emphasising its role in replacing non-compliant foreign platforms. WhatsApp, owned by Meta—which also operates the already banned Facebook and Instagram—responded sharply, accusing Moscow of attempting a full block to force users onto a “state-owned surveillance app.” The company stated: “Trying to isolate over 100 million users from private and secure communication is a backwards step and can only lead to less safety for people in Russia,” vowing continued efforts to reconnect users.

The block is not isolated. Earlier this week, Roskomnadzor, Russia’s communications regulator, announced further restrictions on Telegram for refusing to remove “criminal and terrorist” content, throttling its performance nationwide. Telegram founder Pavel Durov countered that such pressures would not deter the platform’s commitment to “freedom of speech and privacy.” This builds on prior measures, including August 2025 restrictions on video and voice calls on both WhatsApp and Telegram to combat criminal activity, which WhatsApp then decried as access limits.

Max, developed by VK and launched in beta in March 2025, positions itself as a WeChat-like super-app with messaging, voice/video calls, group chats up to 1,000 users, cloud storage, end-to-end encryption for private chats, payments via Russia’s Faster Payment System, and integrations for government services and identity verification. Since September 2025, it has been pre-installed on all new smartphones, tablets and smart TVs sold in Russia, alongside the RuStore app store, as part of a broader “sovereign internet” strategy to monitor communications and replace Western tech amid geopolitical tensions.

Users report partial WhatsApp access via VPNs, but Russian authorities have ramped up countermeasures, restricting 439 VPN providers and enacting a September 2025 law banning ads for bypass tools while deeming VPN use an “aggravating circumstance” in crimes. Fines for individuals deliberately accessing blocked content via VPNs reach 5,000 rubles (about $64). Critics warn these steps enhance state surveillance, while state media insists Max requires fewer user data permissions than rivals.

The clampdown reflects Moscow’s long-running push for digital control, with over 60 percent of VPN users previously accessing banned social media. As Russia promotes domestic alternatives, the moves could reshape communication for its 100 million-plus messaging users, raising global concerns over privacy and internet freedom.


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Nigeria Market Powers Jumia’s Momentum as E-commerce Platform Demand Accelerates

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Nigeria powered Jumia Technologies AG’s strongest growth in 2025, cementing its position as the company’s most important market as rising consumer demand, SME activity and logistics expansion boosted performance across the e-commerce platform.

In the fourth quarter of 2025, Jumia’s Nigeria operations recorded a 50% year-on-year increase in Gross Merchandise Value (GMV) and a 33% rise in orders. The performance highlighted growing adoption of online shopping and Jumia’s increasing relevance to African consumers.

Nigeria’s momentum helped drive 36% year-on-year GMV growth and 34% revenue growth across the group in the quarter, alongside a 26% increase in quarterly active customers. Growth was supported by stronger customer retention and higher order frequency.

Beyond sales growth, Jumia said its Nigeria operations are delivering wider economic impact. The platform supports thousands of local SMEs, enabling them to reach customers nationwide, while continued investment in fulfilment centres and last-mile delivery is creating income opportunities for logistics partners and sales agents.

Efficiency gains were also evident. Fulfilment costs per order declined 12% year-on-year, contributing to a 39% reduction in operating losses and a 47% drop in adjusted EBITDA losses in the fourth quarter. Cash used in operating activities fell sharply to $1.7 million, compared with $26.5 million a year earlier, while liquidity stood at $77.8 million at year-end.

Temidayo Ojo, Chief Executive Officer of Jumia Nigeria, said the results reflect growing trust from consumers and businesses. “Nigeria is central to Jumia’s growth,” Ojo said. “Each order supports local sellers, delivery partners and jobs, while improving access to affordable products for consumers.”

For the full year, Jumia reported 14% GMV growth and 13% revenue growth, with losses narrowing significantly. Looking ahead, the company expects Nigeria to remain a key growth driver as it targets 27–32% GMV growth in 2026 and aims to reach adjusted EBITDA breakeven by the fourth quarter of 2026.

 


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